The following standards have been established for a raw material used to make product P62:
$\begin{array}{lrr}
\text {Standard quantity of the material per unit of output } & \text {6.3pounds } \
\text {Standard price of the material } & \text { $ \$ 15.50 $ per pound} \
\end{array}$

The following data pertain to a recent month's operations:
$$\begin{array} { l c }
\text { Actual material purchased } & 6,700 \text { ounds } \
\text { Actual cost of material purchased } & \$ 100,500 \
\text { Actual material used in production } & 6,400 \text { pounds } \
\text { Actual output } & 920 \text { mits of product P62 }
\end{array}$$
Required:
a. What is the material price variance for the month?
b. What is the material efficiency variance for the month?

Question

The following standards have been established for a raw material used to make product P62:
 $\begin{array}{lrr}
  \text {Standard quantity of the material per unit of output  } & \text {6.3pounds } \
 \text {Standard price of the material  } & \text {  $ \$ 15.50 $ per pound} \
\end{array}$
 
The following data pertain to a recent month's operations:
 $$\begin{array} { l c } 
\text { Actual material purchased } & 6,700 \text { ounds } \
\text { Actual cost of material purchased } & \$ 100,500 \
\text { Actual material used in production } & 6,400 \text { pounds } \
\text { Actual output } & 920 \text { mits of product P62 }
\end{array}$$ 
Required:
a. What is the material price variance for the month?
b. What is the material efficiency variance for the month?

Quizplus · Accepted Answer

The Answer of The following standards have been established for a raw material used to make product P62:
 $\begin{array}{lrr}
  \text {Standard quantity of the material per unit of output  } & \text {6.3pounds } \
 \text {Standard price of the material  } & \text {  $ \$ 15.50 $ per pound} \
\end{array}$
 
The following data pertain to a recent month's operations:
 $$\begin{array} { l c } 
\text { Actual material purchased } & 6,700 \text { ounds } \
\text { Actual cost of material purchased } & \$ 100,500 \
\text { Actual material used in production } & 6,400 \text { pounds } \
\text { Actual output } & 920 \text { mits of product P62 }
\end{array}$$ 
Required:
a. What is the material price variance for the month?
b. What is the material efficiency variance for the month?

The Following Standards Have Been Established for a Raw Material